API US Crude Oil Inventory -- April 24, 2018

 Link here.

Actual: a build of 1.099 million bbls. Forecast not provided. Most folks follow the EIA data that is released on Wednesday, 10:30 EDT.

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Goldman Bullish On Oil

Suggests demand for oil will "continue to soar."

Permian Basin -- Staggering -- Bloomberg -- April 24, 2018

Data points from Bloomberg:

• growing into the largest oil patch in the world
• will hit record production in May, 2018 (3.2 million bopd)
• will produce more than 5 million bopd by 2020 (previously reported; another source)
• Saudi Arabia, Iran, Iraq, the Permian now
• Saudi Arabia, the Permian, Iran, Iraq by the end of the year
• Iran and Iraq each produce less than 5 million bopd
• Iran: produced about 3.81 million bopd in March, 2018

Too bad it's the wrong kind of oil. LOL.  

Random Update Of China And LNG Imports -- April 24, 2018

When I first started blogging some years ago, I knew nothing about natural gas. I think I know a bit more now, but not much.

So, for me, Irina Slav's article on China and natural gas is fascinating. I believe I have seen all of this data before but it's interesting to see it another context.

The headline: can China combat its natural gas crisis? Well, obviously China will combat its natural gas crisis; it already is.

The real question is whether China will succeed. I assume China will succeed but the story will be interesting to follow. If it does not succeed, it's back to more coal and nuclear. India has already made one choice: India will cut back on plans for some nuclear reactors and rely on coal instead.

China, on the other hand, appears to be taking a different direction. Some data points:

• last year (2017)
• China became the world's second-largest LNG importer
• China imported 38 million tons of LNG
• China increased it LNG imports by 46 percent over the previous year -- 46%!
• Now (2018):
• "China will boost its LNG import capacity to 26 million tons annually over the next six years from the current 9 million tons. China's total of LNG import capacity is 17 million tons." (sic)
• China is turning depleted gas fields into storage facilities 
• China plans to have all 25 underground gas storage sites before this winter (2018 - 2019)
• China plans to increase LNG by 25% this year, up to nearly 50 million tons
• fresh customs figures, March, 2018:
• almost a 65% increase in LNG shipments
• 3.25 million tons (annualized = 39 million tons)
• first quarter this year
• 12 million tons LNG imported
• almost a 60% increase on 1Q17
• lots of infrastructure needed: import terminals; pipelines; storage faclities
• will drive GDP

Wow, Wow, Wow! Why I Love To Blog -- Reason #3 -- Absolutely Nothing About The Bakken -- April 24, 2018

The other day I mentioned that I am in my "China phase."

A reader responded with this comment:

If you are still in your China phase, James Clavell's series of books about the Noble House are great reads. I started with Tai-Pan and worked myself around to all the others that are tied into the Noble House Theme. Some great info on the opium "trade" that Great Britain was conducting at that time in history. 

Today, while slogging through The Opium Wars, W. Travis Hanes III, c. 2002, I came across this paragraph:

Anticipating the end of the East India Company monopoly, in 1832 Jardine and Matheson joined forces to form Jardine, Matheson & Co., and in 1834 had shipped the first private loads of tea and silk from China to Britain. The company quickly became the most powerful and influential firm in the China trade and in the future Hong Kong; along with its colorful founders, it was the model for James Clavell's novels Tai-Pan and Noble House. 

Wow. And that's why I love to blog. Had the reader not taken the time to send me that note, I would have simply quickly read the paragraph, moved on, and not giving it much thought. All of that will now stick with me for a lot longer than it otherwise might have.

I replied to the reader that I had not read any of Clavell's novels (yet) but the thought that comes immediately to mind: Ayn Rand's novels.

Again, my Eurocentric education shortchanged me when it came to Asia. Quite fascinating.

By the way, I assume there are a gazillion books on China that are better than the one I am reading, but it turns out the Hanes book is a whole lot better than I originally thought it was going to be. I see why out local library has it on the shelves.

In a sidebar and getting way off topic, reading about the opening salvo in the "opium wars" reminds me of an episode of Miami Vice in which an American high-ranking officer involved in the drug trade during the Vietnam War comes back to haunt Don Johnson's character. See "Back in the World."

Fascinating, fascinating, fascinating.

True Faith, New Order

Wow! Look At This -- Active Rigs Up To 62 -- As Low As 56 Just A Few Weeks Ago -- April 24, 2018; WTI Flirting With $69 (Again)

Obama's revenge: yesterday I posted/commented on a story with a "Trump's Revenge" headline. For those following the US oil story, it's very clear that the US is suffering from "Obama's Revenge." Killing the Keystone XL almost single-handedly put the US in the situation it finds itself with the wrong kind of oil. Was this all calculated? 

Tea leaves in Kuwait: production will increase -- and will increase significantly -- in the out years.

Tea leaves in Saudi Arabia: Saudi Aramco will "lift" oil-trading volume to six million bopd, currently trading about 3.5 million bopd. Prince Salman is leading the change in Mideast strategy as the region continues to produce less oil Compare with:

• Vitol, the largest independent trader: 7 million bopd (previously mentioned on the blog)
• Shell:  12 million bopd (a publicly traded company)
• BP: 8 million bopd (a publicly traded company)

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Back To The Bakken

Where Fracking Is Always In Fashion

Active rigs:

$68.91↑↑	4/24/2018	04/24/2017	04/24/2016	04/24/2015	04/24/2014
Active Rigs	62	48	29	84	185

RBN Energy: Oklahoma -- processing plants, pipelines planned to keep pace with gas growth, part 2. Earthquakes in Oklahoma? That story is dead. Really, really dead. Apparently.